Header Ad Module

**Glenn** · 07-12-2003, 12:53 PM

I read that article in the newspaper. My immediate thoughts were that the professor talks a load of rubbish. When for goodness sake over the last 100 years has anyone been able to save around 2% of your wages and expect to be able to get into a house.
This is not news this is playing with figures and trying to make a story out of nothing.
It has never been easy to save and buy a home for yourself. When I was first married 30 years ago (yes on the olden days people used to do that) my wife and I worked hard and saved our money. We put all our savings into getting a home before we started a family. (People can still do this today if they wish). It was real hard those days to get a loan. Our first home loan was from the Housing corp. They sat once per month to approve loans and they would only lead us their maximum of the day that amounted to less than 50% of the purchase price. We had to make up the difference with a second mortgage at a much higher interest rate. The deposit was equivalent to one years wages. The banks and so forth would only take into account my wages for servicing a loan and not my wife’s because she might get pregnant and loose her job they said.
Professor Hargreaves would do better to spend his time getting his input data correct. How on earth does he expect to make intelligent predictions on Nelson’s real estate market when the data he produces always combines Nelson in with other lower cost areas like Marlborough and even sometimes the West Coast?
Glenn

**Marcus** · 08-12-2003, 01:08 AM

OUCH! 30 yrs Glenn,

I would have been 1yr old at that time. 30yrs later and I have just popped the question.

.....back to the topic.
I think the amounts and time frames are ludicrous and I believe the biggest hurdle is being overlooked.
I believe the biggest problem at present for those wanting to save is that they fail to control their own spending.

Quite simply put, a growing number of people are spending more than they earn.

I know more people living in bad debt at present than not. We are our own worst enemies and things are only getting worse! Credit card debt in this country is following hot on the trail of US statistics that has now reached epidemic proportions.

We have become a race that demands instant gratification in every respect. If you want almost anything you can “have it now, pay for it later”! Cars, furniture, jewellery, flat screen TV’s, DVD’s, Home theatre systems, whiteware, holidays, clothes, the list goes on and on. Its so easy to get caught up in it all and find oneself with a string of hire purchases and a few credit cards getting regularly worked out. There are so many different tiers of lending available today that are compounding the problem. These institutions are more than happy to feed off the “poor habits” of the weak. For many, it has become and endless downward spiral and goodness only knows where it will all end for everyone. The gap continues to widen between “the haves” and “have nots”.

I see kids that work in gas stations or picture theatres driving modern sports cars that have every possible gadget and accessory that money can buy that would total $30k $40k & sometimes more!
Paying that off on HP has got to kill them for years by which time the car is worth what?
…….a fraction of what it used to be.

With these habits and not to mention for some, a hefty student loan plaguing a lot of our young workforce, its not hard to see why they struggle to put money aside to save for a mortgage.

My 2c.

Regards,
Marcus.

**crazysydneydude** · 08-12-2003, 04:19 PM

I'm afraid that survey doesn't contribute much when it comes to solving the issue of housing affordability.

If you're saving $80 per month (i.e. $20 pw) do you expect to be able to buy a house? This mentality of entitlement is crazy.

The steps to buying property are really pretty simple:

1. Sacrifice - this means going without doodads, quiet nights in rather than big nights out, and not being lax with your spending.
2. Work hard - whether its getting a good education or just getting your hands dirty.
3. Be sensible - control spending, plan ahead, become finacially literate.

It's not that bloody hard to understand.

The way I see it this: the world doesn't owe me a living, I have got to make my own way in life, and I may as well make the best of my circumstances.

**inzvestor** · 08-12-2003, 10:00 PM

In that case I just spent 2 months savings on dinner and a bottle of wine (€70 in Paris - approx $140)

I can save a minimum of $1000 per month (sending money home from London) so that equates to 12.5 months for the average kiwi - according to that article.

Those figures are grossly inaccurate - maybe he was basing his figures purely on WINZ beneficiaries.

**graemeh** · 09-12-2003, 08:28 AM

Originally posted by inzvestor

In that case I just spent 2 months savings on dinner and a bottle of wine (€70 in Paris - approx $140)

Wow! That really puts things in perspective. We had dinner in the best restaurant in Wellington, 9 course meal for two with wine for under $300!

The 9 courses were very small servings but by course 7 I was feeling like Mr Creosote.

We don't know how lucky we are in NZ. I hate to think what a similar meal would cost in Paris.

**RentMaster** · 09-12-2003, 08:42 AM

So true crazysydneydude.

Unfortunately not all people are as money savy as most people in this forum are. The concept of saving is foreign to some people. As soon as the bank account has a balance in it, it is being spent. Sometimes the balance can be negative and it is still being spent - credit cards.

I find it very strange at some of the lavish things not-so-rich people are doing. And they wonder why they are not-so-rich.

I think this was mentioned on another thread - money education in our schools. Maybe all children should read Rich Dad Poor Dad before they leave school? I think it is a frame of mind that can determine if you will be rich or not.

**tamara** · 09-12-2003, 02:40 PM

Hi

I agree that savings habits of people are not necessary well thought through.

My personal feeling is that people think that they want the house of their dreams straight away because of where they have rented and then when they start to look at purchasing a similar property they cant affort it try to save but get stuck saving for something that will continue to unobtainable

tamara

**Glenn** · 09-12-2003, 10:34 PM

Goodness you fellows have it all together.
There has not been one person say they can get all they want by "winning" or "great deals" or an inheritance. Nothing much has changed over the years. A bit of sacrifice and going without personal gratification has to win hands down over just hoping to do better next year after we have paid off our credit card debt.
It is about time investors rose up and pointed out that intellectuals in universities like Prefessor Bob are never going to make it in the real world. They know nothing of real business and hard work.
These are the types that dream up communism. They think there must be something morally wrong to be successful and own an investment property. The morally corrupt people that I see are the slobs who are waiting for the big break from the Government or a higher power. They do not need to go without today because their horse will come in tomorrow. They feel bad about all sorts of things. The person they hate most is themselves. All they deserve is one of my rotten flats.

Header Ad Module

Announcement

Saving a deposit may take decades

Saving a deposit may take decades

Comment

Comment

Comment

Comment

Comment

Comment

Comment

Comment